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IRS to accept only electronic payments for ruling requests

The IRS announced on Thursday that it will no longer accept checks in payment for ruling requests beginning June 15; taxpayers will be required to make the user fee payments electronically. However, the IRS will allow a two-month phase-in period through Aug. 15 during which it will accept either checks or electronic payments.

The new rule applies to requests for private letter rulings, closing agreements, and rulings using Forms 1128, Application to Adopt, Change, or Retain a Tax Year, 2553, Election by a Small Business Corporation, 3115, Application for Change in Accounting Method, or 8716, Election to Have a Tax Year Other Than a Required Tax Year.

The rulings affected are all described in Rev. Proc. 2017-1 and are sent to the IRS Docket, Records and User Fee Branch of the Legal Processing Division of the Associate Chief Counsel (Procedure and Administration). Determination letters are not affected because they are sent to other IRS offices, as described in Rev. Proc. 2017-1.

The new rules require taxpayers to use the Pay.gov system paying with a credit card or debit card, or via direct debit or electronic funds withdrawal from a checking or savings account, instead of a check or money order. According to the IRS, user fees run from $200 to $28,300 depending on the type of ruling being requested.

The IRS cautions that the Pay.gov system can only be used to make payments; the ruling requests themselves and supporting documents must still be submitted by mail or hand-delivered.

Among CPA tax preparers, tax return preparation software generates often extensive and ardent discussion. To get through the rigors of tax season, they depend on their tax preparation software. Here’s how they rate the leading professional products.

The package includes final regulations, guidance on how to calculate W-2 wages, a safe-harbor rule for rental real estate businesses, and new proposed rules on the treatment of previously suspended losses.

Don’t get lost in the fog of legislative changes, developing tax issues, and newly evolving tax planning strategies. Tax Section membership will help you stay up to date and make your practice more efficient.